The bargain hunt has begun: car insurance is becoming cheaper

Everything gets more expensive. Everything? Not quite. The prices for car insurance, for example, have recently fallen. That has to do with the annual changing season. What should consumers be aware of?

Every year, when autumn comes and the leaves fall from the trees, the car insurers battle for new customers. Because until November 30th, insured persons can cancel in time at the turn of the year in order to switch to a new provider.

Prices have already fallen by up to eight percent

The bargain hunt for cheaper car insurance rates has already begun. As the comparison portal Verivox found out in the insurance index it calculated, the prices for new motor vehicle contracts have fallen significantly compared to the previous year. In the middle price segment, the minus in the first ten days of October is three to four percent, in the lower price segment the decline is as much as seven to eight percent.

Check24 has observed a similar development. Accordingly, the average motor vehicle liability premium has fallen by 2.4 percent compared to the previous year to 279 euros. In July, prices were 14 percent higher.

Thanks to Corona: fewer trips, fewer accidents

The corona pandemic is cited as the reason for the price slide. Wolfgang Schütz, managing director of Verivox insurance comparison, speaks of a “delayed corona discharge that did not materialize last year”. In 2020, expenses for damage in car insurance fell by around nine percent. The so-called claims cost ratio fell from 98.4 to 90 percent. No wonder: In the lockdown, cars were driven less, and consequently there were fewer accidents on German roads.

A few insurers passed the savings on to customers. The largest car insurer, HUK-Coburg, reimburses its over eight million customers around 185 million euros. DEVK credits its policyholders with a total of 13 million euros. However, only those customers who did not report any damage get their money back.

Automatic repayment is not made with all insurers. The second largest auto insurer, Allianz refuses to accept a refund. Many insurers only reimburse part of the premium if the insured has driven fewer kilometers than expected.

Financial tip: great savings potential when switching

Thanks to the “corona effect”, you can save a lot of money this year when you change your car insurance. “Especially if it was a long time since you last changed insurance, the potential for savings is great,” says Kathrin Gotthold, insurance expert at the Finanztip portal. She advises comparing the offers of motor vehicle insurers on the Internet. Finanztip found the best price by combining the offers of the comparison portal Verivox and the direct insurer HUK24.

So that the new car insurance does not lead to a rude awakening, it should include motor vehicle liability with 100 million euros for property damage and 15 million euros per injured person. This is recommended by the ADAC. Increased liability protection for rental car damage in other European countries should also be included. In addition, the ADAC advises to be insured for accidents due to collisions with animals of all kinds. Protection in the event of gross negligence should not be restricted either.

Save costs even without changing tariffs

Even without switching, the cost of car insurance can be reduced. For example, if you pay the entire policy in one fell swoop rather than monthly, you save ten percent money. And if you drive the car yourself and don’t share it with other family members, the policy is also cheaper. Owners of older vehicles (older than twelve years) should consider whether comprehensive insurance still makes sense.

In addition, the costs can be reduced by ten to 20 percent for tariffs with workshop commitment. Telematics tariffs can also pay off for cautious drivers. Here the insurers grant discounts of ten to 30 percent. The only disadvantage: the driver is monitored. He must have a digital sensor installed in the car or a mobile phone app to check the driver’s driving style.